Decatur

Granbury

Hillsboro

Cleburne

Benbrook

Grapevine

MineralWells

Weatherford

Fort Worth

Arlington

Glen Rose

Plano

Lubbock Dallas

Longview

TylerArlington

Fort Worth

Amarillo

Midland

Odessa Round Rock

Austin

New Braunfels

San Antonio

Edinburg

Mission

McAllen

Sugar Land

Houston

Beaumont

Port Arthur

The Woodlands

Irving

El Paso

Population (2017): 2.5 million

Population growth (2010–17): 12.9 percent (Texas: 12.1 percent)

Median household income (2017): $65,439 (Texas: $59,206)

National MSA rank (2017): No. 4* (Dallas and Fort Worth combined)

Kauffman Startup Index rank (2017): No. 11* (Dallas and Fort Worth combined)

*The Fort Worth–Arlington metropolitan division is part of the Dallas–Fort Worth metropolitan statistical area (MSA) and encompasses Hood, Johnson, Parker, Somervell, Tarrant and Wise counties. The population of the Dallas–Fort Worth MSA is 7.4 million. The Kauffman Startup Activity Index, a measure of business creation in the 40 largest U.S. metropolitan areas, is further explained in the appendix.

At a Glance• Fort Worth began as an outpost marking Texas’

western frontier. Rail connections and a central location for cattle drives helped establish the city’s identity as “Cowtown,” a moniker that endures.

• In the years surrounding World War II, Fort Worth emerged as a hub for the aviation and defense industries, key elements of the local economy today.

• Fort Worth’s blue-collar workforce provides a ready labor supply for the manufacturing sector, but a less-educated pool of workers may be a factor shifting some types of employment toward its regional neighbor, Dallas.

• Depressed natural gas prices have limited exploration of the area's Barnett Shale, but high oil prices have aided growth in the metro’s energy sector.

Chart 5.1: Transportation, Manufacturing and Energy Drive Fort Worth's Economy

–0.5

0.0

0.5

1.0

1.5

2.0

2.5

3.0

–2.5 –2.0 –1.5 –1.0 –0.5 0.0 0.5 1.0 1.5 2.0

Loca

tion

quot

ient

in 2

017

Transportationequipment

manufacturing

Mature Star

Transitioning Emerging

Wood products

Glass & ceramics

Percentage-point change in employment share, 2010–17

Education

Energy andmining Construction

Government

Advancedmaterials

Food servicesDefense andsecurity

Business andfinancial services

Retail

Healthservices

Transportationand logistics

Machinerymanufacturing

NOTE: Bubble size represents cluster share of metropolitan statistical area employment.SOURCES: Texas Workforce Commission; Bureau of Labor Statistics.

29Section 5: Fort Worth—Arlington

Fort Worth–Arlington:Transportation-Related Sectors Predominate in Local Economy

HISTORY: Cowtown Takes Offwith Aviation

Fort Worth, established as an Army fort near the

Clear Fork of the Trinity River in 1849, is named after

Mexican–American War hero U.S. Army Gen. William

Jenkins Worth. He had proposed a series of 10 forts

from Eagle Pass to North Texas to mark the western Tex-

as frontier. Shortly after Fort Worth’s inception, settlers

began moving in and, by 1860, had established the city

as a county seat. However, its initial growth spurt didn’t

occur until after the Civil War.1

Once a wayside for cowboys on cattle drives to Kan-

sas, Fort Worth attracted the interest of cattle buyers and

meatpackers and acquired the nickname “Cowtown.”

Th e Texas Pacifi c Railway completed a route linking Fort

Worth with San Diego in 1876—the fi rst in a series of

railroad ties—and the city caught the attention of Armour

and Co. and Swift and Co. Local citizens assembled a

$100,000 incentive to entice the companies. Both began

slaughterhouse operations in 1903, helping draw a bur-

geoning livestock trade to north Fort Worth.

Following the discovery of oil in Texas in 1901,

refi nery and pipeline fi rms came to Fort Worth. Oil and

gas companies increased their foothold during the oil

boom of the 1980s and the more recent discovery of

large natural gas deposits in the nearby Barnett Shale.

With World War II, the aviation industry established

a major presence in the form of Consolidated Aircraft

Corp. (later acquired by General Dynamics Corp. and

now part of Lockheed Martin Aeronautics Co.). Carswell

Air Force Base (now the Naval Air Station Joint Reserve

Base), part of the Strategic Air Command, was located

next door. Th e siting of Dallas/Fort Worth International

Airport (DFW) in 1973 on the Tarrant–Dallas county line

and subsequent relocation of American Airlines nearby

have continued to link the city to the aviation industry.

At a Glance• Fort Worth began as an outpost marking Texas’

western frontier. Rail connections and a central location for cattle drives helped establish the city’s identity as “Cowtown,” a moniker that endures.

• In the years surrounding World War II, Fort Worth emerged as a hub for the aviation and defense industries, key elements of the local economy today.

• Fort Worth’s blue-collar workforce provides a ready labor supply for the manufacturing sector, but a less-educated pool of workers may be a factor shifting some types of employment toward its regional neighbor, Dallas.

• Depressed natural gas prices have limited exploration of the area's Barnett Shale, but high oil prices have aided growth in the metro’s energy sector.

Chart 5.2: Job Gains Broad Based Across Dominant Goods and Services-Related Clusters

–34 –14 –13

–10 –10

–6 –5

–1 0

1 1

4 4 5

8 8 9

10 17 17 17

20 21

25 26

30 31

39

–40 –30 –20 –10 0 10 20 30 40 50

Computer mfg (0.2%)Transportation & logistics (4.8%)

Textiles (0.4%)Advanced materials (1.9%)

Primary metal mfg (0.1%)Publishing & information (1.1%)

Utilities (0.3%)Biomedical (0.7%)

Defense & security (3.8%)Government (4.7%)

Electrical equipment mfg (0.2%)Transportation equipment mfg (3.1%)

Education (8.8%)Information technology & telecom (3.0%)

Agribusiness (1.0%)Recreation (3.0%)Chemicals (1.6%)

Business & financial svcs (7.0%)Machinery mfg (0.9%)

TotalRetail (11.8%)

Glass & ceramics (0.4%)Fabricated metal mfg (1.1%)

Wood products (1.6%)Energy & mining (7.0%)

Health svcs (11.3%)Food svcs (9.2%)

Construction (5.9%)

Percent change in employment, 2010–17

NOTES: Percent change in employment is shown in whole numbers. Each cluster's share of total jobs is shown in parentheses (rounded to one decimal place).SOURCES: Texas Workforce Commission; authors' calculations.

Federal Reserve Bank of Dallas30

INDUSTRY CLUSTERS: Transportation Manufacturing, Defense Vital

Location quotients (LQs), which compare the rela-

tive concentration of various industry clusters locally

and nationally, are a convenient way of assessing key

drivers in an economy. An LQ exceeding 1 indicates

that a specific industry cluster carries more relative

weight locally than nationally. Industry cluster growth is

measured by the percentage-point change in its share of

local employment between 2010 and 2017 (Chart 5.1).2

Clusters in the top half of Chart 5.1, such as trans-

portation equipment manufacturing, have a larger

share of employment relative to the nation and, thus,

an LQ greater than 1. These clusters are generally vital

to the area’s economy and can be expanding rapidly

(“star”) or growing slowly (“mature”). Those in the bot-

tom half, such as advanced materials and government,

are less dominant locally than nationally and, hence,

have an LQ less than 1. “Emerging” clusters, such as

health services, are fast growing; those growing slowly

or contracting are “transitioning.”

The large LQs of transportation equipment manu-

facturing, transportation and logistics, and defense and

security reflect their outsized role in the region. Along

with DFW Airport, Fort Worth Alliance Airport and the

Joint Reserve Base are major hubs. They have helped

spur additional activity, much of it tied to e-commerce.

United Parcel Service (UPS) has been constructing a

$200 million package operations facility in Arlington,

expected to employ 1,400 full-time-equivalent posi-

tions. FedEx already operates a growing regional sorting

hub at Alliance.

General Motors has operated an automobile as-

sembly plant in Arlington since 1954 and continues to

invest in its growth. The plant specializes in larger sport

utility vehicles. A $1.4 billion upgrade and expansion

began at the facility in 2015, and in 2018, the company

was completing a nearby manufacturing and warehous-

ing complex to augment existing production.3

Fort Worth’s largest industry clusters drive essential

activity and development—these include retail, health

services, food services and education. Retail, which ex-

perienced employment growth of 17 percent during the

2010–17 study period, is the largest cluster (Chart 5.2).

Jobs in food services, the third-largest cluster, expanded

31 percent during the period. The smaller recreation

Table 5.1: Transportation Manufacturing and Defense Sectors Pace Earnings

Cluster Fort Worth U.S.

2010 2012 2014 2016 2017 2017

Transportation equipment manufacturing 94,220 96,044 92,359 99,533 95,231 73,569

Transportation and logistics 58,733 58,450 49,894 45,509 46,467 53,761

Energy and mining 83,368 75,853 78,625 71,766 72,643 80,900

Construction 50,460 51,753 54,579 57,863 60,418 60,742

Glass and ceramics 51,932 55,022 59,728 59,747 62,752 55,398

Fabricated metal manufacturing 52,526 53,323 55,472 54,188 55,033 55,830

Machinery manufacturing 66,040 69,553 67,927 66,944 68,726 70,059

Food services 17,533 17,437 17,565 18,164 18,254 18,963

Defense and security 87,777 87,885 88,876 91,022 89,034 91,226

Retail 32,001 31,397 31,680 32,110 31,700 31,216

Wood products 47,531 48,261 49,498 52,251 53,924 52,914

Chemicals 98,629 93,074 87,437 75,376 72,983 72,887

Education 43,232 42,308 43,278 44,695 44,066 49,322

Clusters with location quotient > 1 52,605 53,336 52,751 50,106 50,044 –

Clusters with location quotient < 1 64,161 59,931 60,142 64,908 64,544 –

Average earnings (total) 51,298 50,841 51,875 52,276 52,714 55,375

NOTES: Clusters are listed in order of location quotient (LQ); clusters shown are those with LQs greater than 1. Earnings are in 2017 dollars.SOURCES: Texas Workforce Commission; Bureau of Labor Statistics; authors' calculations.

31Section 5: Fort Worth—Arlington

cluster, which grew 8 percent, includes Arlington’s Six

Flags Over Texas amusement park. The park’s parent

company, Six Flags Entertainment Corp., is based in

nearby Grand Prairie.

The energy and mining cluster holds a large overall

employment share and experienced the fourth-fastest

employment growth of all clusters, up 26 percent from

2010 to 2017. Fort Worth was a commercial center for the

oil industry early in the last century and enjoyed easy

access to the Permian Basin to the west. Today, it is the

center of the Barnett Shale formation, a prolific source

of natural gas. Persistent price weakness—natural gas

was selling for about one-third of its July 2008 high in

November 2018—has prompted some retrenchment.

The Fort Worth metropolitan division also supports

a sizable defense and security cluster that includes

Lockheed Martin Corp. and Bell Helicopter. Arlington is

the site of two premier sports facilities—AT&T Stadium,

where the Dallas Cowboys football team has played

since moving from Irving in 2009, and Globe Life Park

(formerly the Ballpark in Arlington), home field of the

Texas Rangers baseball team. A $1.1 billion, 41,000-seat

baseball stadium, Globe Life Field, is under construc-

tion and scheduled to open in 2020.

Fort Worth’s construction industry cluster was the

fastest-growing over the study period. In 2016, the value

of all construction activity in the greater Dallas–Fort

Worth metropolitan area ranked second among the

nation’s metros, according to Dodge Data and Analyt-

ics.4 Major projects recently undertaken in Fort Worth

include Facebook’s more than $1 billion data center

and a $450 million multipurpose arena near the Will

Rogers Memorial Center that will become home of the

annual Fort Worth Stock Show & Rodeo.5 Residential

construction activity in Fort Worth has picked up as

well, and growth in single-family permits exceeded the

Dallas metropolitan division in 2017 for the first time

since 2013.6

On average, clusters with a greater employment

concentration locally than nationally paid $50,000

annually, compared with those with a relatively smaller

presence, at $64,500 (Table 5.1). However, within more

concentrated clusters, average pay varies widely. Trans-

portation equipment manufacturing—with nearly three

Chart 5.3: Share of College Graduates Lower in Fort Worth Relative to Dallas

15.5

20.5

27.4

36.5

14.4

26.5

30.328.8

0

5

10

15

20

25

30

35

40

Less than high school High school graduate or equivalent Some college or associate degree Bachelor's degree or higher

Percent

Dallas

Fort Worth

NOTE: Share of population age 25 and over.SOURCE: Census Bureau, 2016 American Community Survey 1-year estimates.

Federal Reserve Bank of Dallas32

times the national employment share (LQ of 2.7)—pays

well, at $95,200, as does defense and security (LQ of

1.1), at $89,000. By comparison, the larger food services

and retail clusters (both straddling the star and emerg-

ing categories) were among the lowest paying, at about

$18,300 and $31,700 a year, respectively.

DEMOGRAPHICS: In-Migration Key to Growth

Fort Worth and its larger neighbor, Dallas, make up

the Dallas–Fort Worth metroplex—the fourth-largest

MSA in the country, with 7.4 million people in 2017.7

New residents from elsewhere in the U.S. accounted for

40 percent of the metroplex’s population growth in 2017,

and the region took the top spot nationally for total net

migration from 2010 to 2017. The largest share of people

moving from outside the state to Dallas–Fort Worth in

2016 came from California, followed by Oklahoma.

A total of 59.3 percent of the Fort Worth area’s for-

eign-born population came from Latin America, less

than the 68.6 percent share for Texas overall in 2016.

In 2017, Fort Worth’s median household income—

the midpoint at which half of incomes are above and

below—was $65,439, exceeding the U.S. median of

$63,336 but trailing Dallas.

Consistent with the area’s manufacturing emphasis,

28.8 percent of workers age 25 and older hold a bach-

elor’s or higher degree, less than Dallas at 36.5 percent

and the U.S. at 31.2 percent but on par with Texas at 28.9

percent (Chart 5.3). The share of adults with only a high

school diploma in Fort Worth exceeds the share in Dallas.

EMPLOYMENT: Energy Affects Postrecession Recovery

While Fort Worth and Dallas together make up a

diversified economy that closely resembles the U.S. as a

whole, the influence of the mining and energy clus-

ter—whose LQ of 1.2 makes it more prominent locally

than nationally—likely helped Fort Worth get a quicker

start than its sibling metro following the Great Reces-

sion. While it took Dallas 51 months to regain all the

jobs it lost during the recession, Fort Worth was able to

rebound in 43 months.

The situation was reversed in 2015, when the steep

decline of oil and gas prices restrained the Fort Worth

area’s expansion.

33Section 5: Fort Worth—Arlington

Notes1 The history of Fort Worth is taken from the Texas State Historical Associa-tion’s Handbook of Texas, tshaonline.org/handbook/online/articles/hdf01.2 The percentage shares of individual clusters do not add to 100 because some industries are counted in multiple clusters, and some industries are not counted at all based on cluster definitions. (See the appendix for more information.)3 “GM Adds 850 More Jobs in Arlington, Expands to Six Flags Mall Site,” by Tracy M. Cook, Dallas Morning News, June 16, 2017, www.dallasnews.com/business/jobs/2017/06/16/general-motors-bring-850-jobs-arlington.4 “Dallas–Fort Worth Construction Is Slowing from Recent Highs,” by Steve Brown, Dallas Morning News, Aug. 1, 2017, www.dallasnews.com/business/real-estate/2017/08/01/dallas-fort-worth-construction-slowing-recent-highs.

Fort Worth—Arlington Growth Outlook

Drivers Challenges• Manufacturing operations, defense industry installations

and transportation and logistics facilities provide a strong foundation of well-paying jobs.

• Expanding oil production will continue to benefit Fort Worth’s energy and manufacturing sectors, fueling job growth in the metro.

• Greater housing affordability relative to Dallas will attract residents and employers to Fort Worth.

• Volatile fuel prices may affect expansion in Fort Worth’s large transportation cluster.

• A relatively less-well-educated workforce may limit the kinds of businesses that select a Fort Worth location over one in Dallas.

• The defense and security cluster and large military base are vulnerable to federal budget cuts in the future.

5 “Facebook’s Fort Worth Data Center Opening This Week Is Getting Big-ger,” by Steve Brown, Dallas Morning News, May 3, 2017, www.dallasnews.com/business/real-estate/2017/05/03/facebooks-fort-worth-data-center-opening-week-getting-bigger; “New $450 Million Dickies Arena Moves For-ward in Fort Worth,” by Larry Collins, KXAS-TV, April 18, 2017, www.nbcdfw.com/news/local/New-450-million-Fort-Worth-Arena--419681933.html. 6 In 2017, single-family permits in the Dallas–Plano–Irving metropolitan divi-sion were up 13 percent from the previous year compared with a 29 percent increase in Fort Worth–Arlington. 7 The 2017 population estimates are from the Census Bureau. The three largest metropolitan statistical areas are New York–Newark–Jersey City, Los Angeles–Long Beach–Anaheim and Chicago–Naperville–Elgin.

Through much of 2012 and 2013, the Fort Worth

area’s unemployment rate was lower than Dallas’. A wid-

er spread—this time favoring Dallas—emerged during

2015 as the energy slump deepened. Employment

growth in Fort Worth slowed to 0.9 percent in 2015, and

in 2016, job gains occurred at a 1.5 percent rate. This

compares with 3.7 percent for Dallas over the same

period. Higher oil prices and a pickup in manufacturing

activity boosted Fort Worth employment growth to 2.3

percent in 2017, similar to Dallas’ 2.6 percent increase.

Fort Worth's unemployment rate was 0.7 percentage

points below the U.S. average during most of 2017 and

was little changed through much of 2018.

OUTLOOK: Transportation and Defense Lead

Although sometimes viewed as a single economic

unit with Dallas, the Fort Worth region has a unique and

complementary industry profile, with a greater concen-

tration in energy, transportation and defense. In the near

term, those industries’ performances will help set the

course for Fort Worth. Logistics is an expanding sector

that should provide a net positive. A lower cost of housing

relative to Dallas will continue to attract residents to Fort

Worth, which in 2017 outpaced its eastern neighbor in

both single-family and multifamily construction.

Federal budget decisions will likely help set the

long-term outlook for the historically powerful defense

and security cluster and the almost 4 percent of the

workforce it represents. Stagnant prices for natural gas

will damp prospects and limit natural gas exploration

along the Barnett Shale. Record high oil production in

the state will continue to boost growth in the energy

and mining cluster, which makes up 7 percent of the

region’s employment and is classified as a star among

Fort Worth’s clusters.

—Michael Weiss and Alexander T. Abraham